Enterprises sometimes invest idle funds to get income and returns. Many enterprises choose to invest in bonds, and the interest income received by bonds can be included in the accounting subject of "investment income". How to make relevant accounting entries?

Accounting entries of bond interest income received

1. The accounting entries of the declared undistributed interest included when the enterprise purchases are as follows:

Borrow: interest receivable

Loans: bank deposits

When the enterprise receives relevant interest, the accounting entries are as follows:

Debit: bank deposit

Loan: interest receivable

2. Interest on bonds received during the holding period:

Debit: bank deposit

Loan: investment income

What is interest receivable?

Refers to the bond interest that has reached the interest payment period but has not been received in the actual payment price of short-term bond investment. This part of interest receivable is not included in the initial investment cost of short-term bond investment, but the actually paid price includes the bond interest that has not yet expired, and is included in the part of the initial investment cost of short-term bond investment that does not need to be accounted separately.

What is investment income?

Refers to the income obtained by enterprises from foreign investment (the losses incurred are negative), such as dividend income, bond interest income, profits shared by joint ventures with other units, etc. It is a profit and loss account, with fewer debits and more credits. The use of "investment income" subjects includes: voucher investment income, investment real estate rent, trading financial assets disposed by enterprises, trading financial liabilities, gains and losses realized by available-for-sale financial assets, etc.